These Are the Business Applications of Predictive Analytics

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This year is make-or-break for your business. If you play your cards right, you may double your customer pool and send revenue sales soaring through the roof. Of course, if you mismanage your hand, you can kiss your career goodbye.

Predicting the future is a power that would make your life a lot easier. Believe it or not, this power is a lot more accessible than you may realize. Puzzled? Then it’s time you explored the world of predictive analytics.   

Imagine having the inside scoop on your market and your customers. You’d know when to ramp up your marketing efforts. You can then know when to sit back and wait for better times or reach out to customers and take chances.

Having a good idea of what’s to come will give your business a huge advantage over the competition. Read on to learn how you can take steps now to improve the future outlook of your company.  

Predictive Analytics for Your Business 

Predictive analytics combines data, models, and machine learning to inform future decision-making. This discipline looks back on information from the past. From revenue to customer interactions, all data is collected and used to predict future outcomes.  

When it comes to forecasting the future, insurance companies may come to mind. But the amount of business intelligence predictive analytics provides will surprise you. 

So don’t dismiss this discipline as irrelevant. Here are a few reasons why making predictive analytics a part of your business approach is important

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1. Customer Relations 

Maintaining customer relations is one of the hardest parts of running a business. You need to know what people want and when they want it. It’s never easy keeping up with people’s whims. Predictive analytics for business can help with that. 

Making a Good First Impression 

Everyone should start on the right foot. Help yourself by defining your customer base and researching their backgrounds. 

Demographics are crucial for reaching potential customers. How old are your customers? Where do they live? What are their interests? Answering these questions can give hwlp you understand who to market to and how to sell to them.

Choosing the right medium or social media platform to kick off customer interactions is key. Improve your marketing strategy by getting to know your customers before reaching out to them.

Growing From Goodbyes

Customers want you to listen to them, even when they leave you. Knowing why your customers are leaving can tell you what changes you need to make. 

Are customers leaving because they felt ignored? Then change up your communication strategy. Are customers dissatisfied with services or pricing? Then see what you can do to improve future interactions and meet customer needs.  

You can’t retain all customers, but you can learn from your mistakes and do better with future customers. Listening goes a long way in keeping customers satisfied. Consider a partner who can help you build and maintain strong relationships with your customers.   

2. Good Timing 

Timing is everything when it comes down to the success of your business. If the timing’s off, your product might not make sense to potential customers. Avoid killing momentum by researching when to market to your customer base. 

Tracking Sales 

There are predictive analytics applications for helping you determine how much money you’ll make in the next year. You can look back on times when sales were booming and then observe the country’s current economic state.

Were there particular seasons or times of the year when customers bought your product? Are people in a position to buy your product now? Use this information to figure out the best times to market your products to customers. 

Determining when people need your products and if they’re able to purchase them can help you give people something they need and want.   

Controlling for Quality 

The last thing you want is for your customers to think your product is no longer relevant. This can be tricky because people and their preferences change over time. That’s why predictive analytics for business is essential for meeting customer needs. 

Knowing where people are currently in their lives will tell you where they are going. Are customers getting older? Do they use different mediums for communicating? Have they developed new tastes? 

To stay relevant, your product needs to change with your customers. People want a company that can grow with them. Keep track of your changing customer base, so you can deliver high-quality products that meet customer needs time after time. 

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3. Risk Management

Many things can go wrong if you don’t think about the future. The last thing you want is to get blindsided by a rough patch and unexpected losses. This is where predictive analytics has business analytics applications that are valuable lifesavers.

Assessing Risks  

Just as you can look ahead to predict good times, you can also look ahead to predict bad ones. Review your lowest sales periods. When did customers stop buying your product? What led to this dropoff in sales? 

The timing could be the problem. For example, selling winter coats in June is not the most profitable practice. However, you may need to update your marketing range. Customers of a certain demographic may no longer be interested in your product.

Once you determine the causes for loss, you can avoid future dead periods, uninterested customers, and other pitfalls. Study your low points to make your business stronger and steer clear of wasting resources on unsuccessful plans.

Mapping the Market

Although customers should always be at the center of your marketing strategy, you can’t ignore the bigger picture. The economic climate influences people’s tastes, behaviors, and ability to purchase products.

You can use predictive analysis to construct financial models that consider market behavior and larger economic factors. Our environment shapes people, so you need to map out the economic landscape ahead of time.

You can never fully understand your customers without understanding the state of the economy. Knowing the landscape will help you foresee customer behaviors. You can then decide how much energy to invest in marketing initiatives. 

Take a Proactive Approach

Don’t let your business get dragged along by your customers’ whims and a changing economy. Keep your company ahead of the competition by using predictive analytics. It’s okay to adapt to change. But it’s even better if you can anticipate change.

You can never grow a successful business if you don’t learn from your mistakes. Build off of your experiences to create a sharper and smarter business strategy.

Check out our podcast for more tips on how to refine your marketing approach. Or, schedule a free marketing consultation.